City, County OK FedEx incentive packages

Tuesday

Feb 5, 2013 at 10:27 AMFeb 5, 2013 at 9:05 PM

The board on Tuesday quickly and unanimously approved its portion of a multimillion-dollar incentive package to encourage the logistical behemoth to locate a proposed hub for its ground operations in Ocala.

By Bill Thompson and Susan Latham CarrStaff writers

The County Commission didn't need to overnight its response to FedEx.The board on Tuesday quickly and unanimously approved its portion of a multimillion-dollar incentive package to encourage the logistical behemoth to locate a proposed hub for its ground operations in Ocala.Commissioners did not delve into the details of the deal, which provides almost $1.1 million in benefits from county government.Later in the day, the Ocala City Council voted 4-1 to provide FedEx Ground with $2.39 million of incentives, the city's share of the incentive package being sought by the company. Councilwoman Suzy Heinbockel was the lone dissenter."I am very excited that FedEx is coming to Ocala," Heinbockel said after the meeting. "There were 90 percent of the items in the agreement I could agree on. Most of those had to do with moving the utilities and that sort of thing, and expanding the road. The incentive funds and waiving the fees were the 10 percent."Although the city and county approvals are two of the major hurdles needed to lure the package delivery company to Ocala, the owner of the Ocala/Marion County Commerce Park — Williams Kearns' Ocala 489 LLC — still has to approve the sale of the 150 acres at the park, and the state has to approve the $792,000 in Qualified Target Industry grants.Once all the approvals are received, FedEx Ground is expected to go forward with its plans to build a 383,161-square-foot facility, which will lie east of Interstate 75 and north of U.S. 27. The company is pledging to provide 165 jobs paying an average annual wage of $31,536, not including the independent contractors who would assist in the delivery process.FedEx Ground is expected to spend $122.9 million in capital investments, including $75 million for the construction of the facility, with the remainder being used for machinery and equipment.Among its requests, FedEx Ground would like Northwest 35th Avenue, which currently is being built as a two-lane road into the Commerce Park from U.S. 27, to be four lanes instead. The estimated additional cost is $1.6 million.The city already has been awarded a Florida Department of Transportation and state Department of Economic Opportunity grant of up to $2.15 million for road construction and possibly other infrastructure costs. Any costs above that will be paid initially by FedEx Ground, with the city alone or the city and county combined, reimbursing the company over 10 years.Like the county, the city is being asked to match the state QTI grants with $99,000.And, like the county, the city would pay half the estimated $800,000 cost to move a Florida Gas Transmission line, with no more than $400,000 to be paid by each entity.The city also approved $742,000 in fee waivers.In addition to the gas line, the company is asking for other infrastructure to be moved.The city's existing reuse water line will have to be moved at an estimated cost of $150,000. And a 230 kV electric transmission line will be moved at an estimated cost to the city of $750,000.There also will be additional Enterprise Zone incentives offered to the company, as well as Workforce Quick Response Training dollars.If all the pieces come together, construction should begin no later than July 31, 2014, and completed no later than Oct. 31, 2016. The company would have until Dec. 31, 2018, to reach the 165 full-time equivalent jobs and must retain those jobs for 10 years after the completion of the building.Kevin Sheilley, president and CEO of the Ocala-Marion County Chamber Economic Partnership, said there still were many steps needed to bring this project to fruition."It will attract companies that want to locate nearby," Sheilley said about companies wanting to be near FedEx.The county's approval Tuesday hinged on a separate agreement with the City Council in which the city and county both would agree to refrain from putting the Ocala/Marion County Commerce Park land in an Community Redevelopment Area for a period of 25 years.There was concern that the government entities would not be able to attain the return on investment they had anticipated on the FedEx Ground project if the property were placed in a CRA, where taxes collected would have to be spent in that area. The council voted unanimously Tuesday to grant the county that assurance. Heinbockel pointed out that the city had no intentions of putting that area into a CRA anyway.County commissioners, meantime, lauded the pending arrival of the Fortune 100 firm."We have been passionate about economic development. We have been passionate about ... trying to bring jobs ... to this community so families could get back on their feet again," Commissioner Carl Zalak said."We're excited to have these new folks here, and I'm so personally excited about the opportunities ahead of us. By signing this (agreement), we again can give hope to our community that we're on our way back."County Commissioner Kathy Bryant said Tuesday "truly is an exciting day for Marion County. It's an historic day for our community."Bryant paid tribute to the efforts of the County Commission, the Ocala City Council and local economic development agencies that of late have reversed the community's economy, taking it from one of the most sluggish in the nation of one of the fastest-growing. Bryant suggested adding FedEx would only build on that success."This is a huge milestone for us," Bryant added, "not only the jobs and the capital investment that FedEx will bring to our community, but the economic development and what our story is going to end up being in the years to come. It's just a great day to be in Marion County."